Learning Curve

The Challenge of Disciplined Management

May 4th 2009
By Vivek Albuquerque

Management systems dont work without managers with knowledge and skill that are capable of
leading their organizations.

Organizations that experience sustained growth (year after year) have several things in common. One is
superior customer service. Superior customer service relies on a committed and motivated work force
that, in turn, is possible with disciplined management systems to support employee efforts.
Management systems dont work without managers with knowledge and skill; who are capable of
leading their organizations. The flow chart below shows the relationship of these different elements.
This note describes how these various elements are linked and shows that knowledgeable and skilled
managers are able to build and maintain a disciplined management system. And, with a disciplined
system, come committed employees, loyal customers and sustained growth.

Satisfying Customer Needs

The worldwide business community became increasingly concerned during the 1970s and 1980s as
Japanese companies began to dominate several industries, including electronics and automobiles. This
prompted a serious rethinking of the way business is conducted. The conclusion? Satisfying customers is
the primary purpose of every business. This conclusion recognizes the power of reciprocity Satisfy
customers needs and customers reward you with continuing business. This leads to profits and
increased shareholder value.
This idea has been with us at least since the time of Henry Ford. It continues to remain vital to
competitive success. While the idea of satisfying customers began with the organization of marketing
departments and customer surveys, it expanded to include the quality of products and services and now
involvesimproving all the operations of a business.
We no longer define customers as just those that are served by the organization as a whole. To foster a
strong relationship with the end-user (customer) means that units within the organization need to meet
their internal customers needs as well. This promotes a customer-oriented approach throughout the
organization.
Successful organizations those that sustain their growth, see year-to-year profit growth, and
consistent stock valuation all have one thing in common: loyal customers.

Committed Employee
These same organizations know that continuously satisfying their customers (in a way that leads to
financial success) also means they must engage their employees. Just as there is a direct correlation
between customer satisfaction and financial growth, there is a direct correlation between engaged
employees and customer satisfaction.
To have an organization of employees who are committed and engaged requires employees to:

Know what is expected (mission, vision, objectives, control measures)

Understand that all efforts must start with a well-defined endpoint

Be willing to self-manage

Work in a structure that is aligned with the organizations purpose

Understand how they and their unit fit into the larger organization

Know how they and their unit are performing against specific objectives

Feel rewarded and appreciated for their efforts

Have the measures necessary to self-correct when necessary

Know how to make decisions that end in outcomes that are good for the organization and for them


The Need for a Unifying Structure
There have been powerful advances in management theory including:

Quality

Systems thinking

Information engineering

Re-engineering

Performance competencies

The learning organization

All good and all adding value however, these advances do not have the breadth necessary to act as a
unifying structure or a context for managers to implement their ideas. Applying re-engineering without
the full context of a management system is a like applying a breakthrough in heart surgery to without a
full understanding of the complex workings of the human body.

What is missing is the context? We need a unifying structurethat examines critically the logic on which
management is based. These are the fundamentals of management and are the elemental principles,
functions, and activities of an effective management system.

Surrounded as we are in this whirlpool of change, there has never been a greater need for management
discipline.
The fundamentals of management are real. You use them, perhaps intuitively, when you work with
other people in any kind of enterprise from chairing a local charity organization to leading a work team
to building a complex industrial organization. Just as you learn the basics of golf or engineering and then
refine them over time, so you also master the fundamentals of management so that you can apply them
in any situation. These are not merely skills you use on the job they are skills for living you can use at
home, at work, and at play.

There is a need for a unifying structure of management that provides a system that enables disciplined
management. This unifying structure is made up of Management principles, Functions and Activities.
Together, they comprise an effective management system. This is the basis for the Louis Allen
Management System.

These fundamentals include:

Having plans linked to real external needs

Meaningful metrics that measure both purpose and progress and enable employees to sign- up

Five-way communication

Employees selection and development with critical goals in mind

Plans that are coordinated across department boundaries

What are the fundamentals necessary for management success? In short, managers must:

Believe in and follow a few selected principles that, when implemented, truly add value to their
organization

Assure all actions add value by producing real results, which in turn, are linked with identifiable needs;
these needs should be identified in concrete fashion and should be external to the managers area of
responsibility

Communicate effectively, not merely two-way, but what Louis Allen calls five-way communication

Develop plans that include metrics or measures that reflect desired outcomes; assuring that these plans
and measures are aligned and communicated throughout the organization

Assure that these measures or metrics exists to serve both as a guide and to build alignment and
commitment throughout the organization

Assure that people at all levels of the organization have the skills necessary to solve the problems that
prevent them from serving their customers

See to it that plans are coordinated across internal organizational boundaries

Ensure that employees at all levels are aware of the value chain, their place in it, and how their
organization contributes to its success

Assure that people are skilled at developing and measuring the metrics they need to do their jobs

The Allen Management System provides and ensures all of the above.

Management as a System
Its important to understand just what a system is it is an entity with two or more parts and no part
has an independent effect on the whole and all parts affect the whole. As a result of the
interrelationship of its parts, the whole system is greater than the sum of these parts. A system also
interacts with its environment by: Obtaining inputs from the environment, transforming these inputs to
outputs and delivering the outputs to the environment

Thus, for any system, we can identify inputs, a transformation process, and outputs. For example, a
motor gets energy as input, transforms that energy to power, and outputs motion. In business, typical
inputs are people, capital, materials, time, and machines, and the outputs are the products/services
delivered to the users. The transformation process can consist of the activities of production by the
organization's members and the organization's interaction with its environment.
Its easier to understand and apply management concepts if management is thought of as a system. All
activities of management are interrelated. This means changing one activity will impact others. Example:
changing how people are rewarded may change training activities, selection processes, and decision-
making and communication activities.
Management is a system because managers take inputs (information, money, resources, time, material)
and transform that input into outputs (product, service, profits, etc.).

This is the way we, at Louis Allen, think about management. Since all activities a manager performs are
interdependent, management cannot be understood or mastered by looking at each activity separately
(the way most training programs approach management). Each activity is part of a system and must be
analyzed in relationship to the other parts. It is the fit of the parts that makes the system effective.

Universal Management Functions
There are four universal management functions:

Planning: Plans needs to be linked to external needs and define real value.

Organizing: How managers structure the organization and work is critical to successful execution of their
plans.

Leading: Execution also requires leadership, which includes selecting and developing the right people,
assuring decisions are made in a way that builds commitment, and building an environment of open
communication and self-motivation.

Controlling: The focus is on measures not controlling people. Effective measures do not exist in most
organizations. Without measures, alignment is difficult, if not impossible.

The Professional Managers Practice


Mastery of the concepts and principles of a disciplined management approach

Putting them to use at once as a unified system - all parts fit

Understanding important new changes their advantages and disadvantages and how they fit into the
management system

Gaining from the experience of companies all over the world to give tested techniques for performing
work more efficiently and with greater satisfaction

Developing strategic and operating plans with the team

Determining the best type of organization and how to make it work

Empowering team members to plan, implement, and control their own tasks

Making sound, reasoned decisions with ones team

Communicating effectively with those inside and outside the organization the larger team

Selecting and Developing competent, committed people

Controlling and improving work and results

Developing ones teamand the selfto continually learn and adapt to new conditions and situations

Conclusion

Effective organizations organizations that sustain their growth and continuously justify their
customers loyalty have a preponderance of committed and engaged employees who are productive,
efficient and effective, and who:

Know that management is more than just supervising others

Understand the importance of technology and the pace of technological change

Work within a unifying structure of management comprising principles, functions and activities
which provides a system that enables the practice of disciplined management


0 Comments